Jefferies downgraded SoftBank Group to an Underperform rating, linking the move to heightened risks from the conglomerate’s concentrated exposure to OpenAI and the leverage needed to meet those commitments. The broker established a fresh price target of ¥3,140, reduced from ¥5,118 on a stock-split-adjusted basis, which Jefferies estimated equates to roughly a 19% decline from prevailing market prices.
At the core of Jefferies’ analysis is SoftBank’s growing role as the primary financier in multiple OpenAI funding rounds. The brokerage warned that SoftBank supplying the bulk of capital to OpenAI could lead to inflated private valuations for the AI developer, which in turn may distort the calculation of SoftBank’s reported net asset value.
Jefferies also highlighted the existence of related-party transactions between SoftBank and firms in its investment portfolio. The firm noted that SoftBank pays about $3 billion annually to OpenAI for services provided in Japan. Separately, payments of about $200 million to Arm Holdings represent roughly 16% of Arm’s quarterly revenue, according to the brokerage.
Competition in the artificial intelligence industry is another element driving Jefferies’ caution. The broker pointed to technological advances from rivals including Google - with its Gemini models - Anthropic - with Claude - and xAI - with Grok. Jefferies asserted that enterprise adoption patterns are shifting toward Anthropic, while large technology companies are expanding their in-house models and distribution channels.
On OpenAI’s financial position, Jefferies cited reports that the company incurred losses of about $12 billion in the third quarter of 2025, a figure that the brokerage said implies an annualized cash burn in excess of $50 billion. Those reported losses, Jefferies argued, have prompted OpenAI to consider advertising as a potential source of revenue.
Concerns about SoftBank’s balance sheet were also underscored. Jefferies referred to S&P Global Ratings’ decision in March 2026 to revise SoftBank’s outlook to negative, a move S&P attributed in part to the scale of SoftBank’s approximately $30 billion commitment to OpenAI and the associated pressure on the company’s financial flexibility.
Jefferies did leave room for its assessment to change under defined circumstances. The brokerage said its negative stance could be reversed if OpenAI were to complete a public listing at a valuation higher than its most recent private rounds or if substantial new outside investor capital were to materialize.
Contextual note - Jefferies’ conclusions reflect its analysis of valuation transparency, intercompany flows and the balance-sheet implications of large-scale AI financing commitments, as well as the evolving competitive landscape among AI model developers.